UAE services market growing

The UAE’s IT services market is set to continue its healthy growth as customers look at more “value-add” services such as outsourcing, training and application development, according to research house IDC. While the lion’s share of IT services spend still goes on deployment and systems integration, outsourcing is expected to enjoy double-digit growth for the next five years.

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By  Peter Branton Published  July 6, 2003

The UAE’s IT services market is set to continue its healthy growth as customers look at more “value-add” services such as outsourcing, training and application development, according to research house IDC. While the lion’s share of IT services spend still goes on deployment and systems integration, outsourcing is expected to enjoy double-digit growth for the next five years.

For 2002, the UAE IT services market was worth $234.3 million, with deployment & support and systems integration making up nearly 60% of the total. However, IDC said outsourcing, customisation and education are all making their mark in the UAE.

“Rising dependence on IT for business continuity combined with investments in relatively advanced IT products has created a higher incentive among local firms for using external providers to secure smooth running of production processes and to reduce down-time on mission-critical part of their IT solutions,” said Torben Pedersen, senior analyst with IDC MEA. “As a result of higher demand, outsourcing providers are aggressively looking at ways to gain footage in the large account segments that traditionally has relied on in-house IT departments. These include building offshore capabilities and using out-tasking delivery as an alternative to the traditional outsourcing model,” he added.

Over the next five years, IDC expects the UAE’s IT services market to expand by 11.7% a year, to reach over $400 million by 2007.

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